BT faces fading market share

BT should see its dominance of the UK's residential fixed line market evaporate over the next ten years according to boffins at Research Analysis and Knowledge Management.

They predict that BT Retail's share of the UK's fixed line market will fall from 82 per cent to 45 per cent over the next decade as increased competition begins to bite.

At the moment, around 93 per cent of UK households have a fixed line, with eight in ten supplied by BT. But as more and more punters switch providers - and increasing numbers of telcos bundle line rental with their tariffs - BT's share of the market is predicted to slide.

And the development of wholesale line rental (WLR) should accelerate BT's declining market share. In essence, WLR means consumers who opt for other phone providers can pay for their calls and line rental in one single bill as opposed to having to pay for calls (to a telco such as Tele2, Carphone Warehouse or One.Tel, for example) and line rental (to BT) separately.

Even though the process to transfer customers is not as slick as it should be, it does offer rival telcos more leeway to offer punters cheaper services.

One.Tel - which is owned by Centrica and services 1.75 million fixed line, mobile and Internet punters - today unveiled a home phone service that includes both line rental and call charges in one bill using WLR.

The company said it has taken "advantage of the long-awaited dismantling of BT's line rental monopoly". One.Tel's upfront line rental charges are cheaper than BT's (£9.99 per month compared to the £10.50 charged by BT) and it reckons, overall, it can save the average household between £70 and £90 a year.

"It's over 20 years since BT's monopoly was supposedly broken, and this is another step towards achieving a level playing field in home telephony," said Ian El Mokadem.

"As one of BT's biggest rivals we intend to take full advantage of this line rental revolution, by offering those switching away from BT even bigger savings and the convenience of a single bill."

He said that One.Tel was now at a point where it "can confidently offer people a full break away from BT." ®